South Korean steelmakers could see annual trade-revenue losses of more than €890 million by 2034 under a modelling scenario assessing the full phase-in of the EU Carbon Border Adjustment Mechanism.
The estimate comes from research by NewClimate Institute and NEXT Group, which puts the potential impact at about $20 million in 2026 and more than $1 billion in 2034. Converted using the European Central Bank reference rate of 2 October, those amounts correspond to approximately €18 million and more than €890 million, respectively.
Modelled impact rises with CBAM phase-in
The figures represent potential effects on trade revenue rather than an observed decline in South Korean steel sales during 2026. They also do not correspond directly to the amount of CBAM certificates Korean exporters would purchase.
CBAM operates within the EU’s import framework, while the commercial impact on producers can be transmitted through changes in prices and demand.
Using its CLIMTRADE modelling framework, NewClimate Institute assesses how South Korea’s industrial exposure changes as carbon costs become more significant. The analysis links a stronger competitive position to lower-emission production and domestic reforms that strengthen incentives for industrial decarbonisation.
The 2034 figure represents the endpoint of the full phase-in assumed in the study. It is a scenario date rather than an indication that future policy details or market prices are already established. Any changes to the EU timetable would need to be considered separately from the modelling assumptions.
Emissions performance becomes relevant to steel trade
For South Korean steelmakers, the modelled increase from a relatively small impact in 2026 to more than €890 million annually in 2034 places investment timing within the longer-term trade exposure identified by the study.
Production assets approved today could remain in operation as a larger share of carbon-related exposure is reflected in European steel trade. The projected impact, however, is not a fixed future bill.
Changes in production routes, export destinations, customer demand and policy could alter the outcome identified by the modelling.
The study therefore places the evolution of the emissions associated with Korean steel at the centre of its assessment of future European market exposure, alongside the development of domestic decarbonisation incentives.
